The quality of your data dictates the probability of getting an accurate, audit defensible credit calculated. More detail makes it easier to defend. We can work

The quality of your data dictates the probability of getting an accurate, audit defensible credit calculated. More detail makes it easier to defend. We can work with "R&D work" level of detail, but it is less defensible and it will cost more to have us (an accounting or consulting firm) calculate the credit for you. It also makes it much harder to calculate in-house or using paid self-help software tools. Particularly because IRS rules require that the wage costs be allocable to a "business component." Business component is a technical term of art specific to the R&D credit, but roughly it corresponds to projects, and more specifically to a (1) new or improved (2) product, process, technique, formula, or invention. It must be one and only one of those, no mixing of new and improved or product and process. So if you have a new product and a corresponding new production process, they must be separated in the reporting of qualified research expenditures, even if you as a taxpayer have classified the two BCs as a single project. So when you have time tracking, it is best when it allows us to tie specific hours worked to specific projects and tasks. We can then work out from the project list how to combine or split up your projects into business components and map the costs that way. From your activity codes, we can set a very specific and defensible qualified percentage to each employee's time, without having to disrupt your business by surveying your employees (plus the IRS does not respect self-reported, non-contemporaneous survey data much if at all). As an example, I walked into a software dev client's offices a few weeks ago to sit down with the CFO, comptroller, and their head of development. I walked out with highly detailed project tracking data and spent four hours processing it using our internal software tools, calculating a $2m benefit with a high degree of accuracy. At other firms with lower quality data, it can take hundreds of man hours to achieve the same benefit. So we gave the software client a massive break on our fee (and actually still profited more than we would have with a less prepared client) and everyone walked away happy.